Ethical Investment

“Many of those who possess more resources and economic or political power seem mostly to be concerned with masking the problems or concealing their symptoms, simply making efforts to reduce some of the negative impacts of climate change….There is an urgent need to develop policies so that, in the next few years, the emission of carbon dioxide and other highly polluting gases can be drastically reduced, for example, substituting for fossil fuels and developing sources of renewable energy.”
Pope Francis, Laudato Si’, 24 May 2015

The Catholic Church has long recognised the importance of business being consistent with the gospel values and social teachings of the Church. One way in which consistency can be achieved is through ethical investment.

Ethical Investment describes a range of activities that seek to combine the financial objectives of investment with wider concerns about environmental and social issues. These activities include:

  1. Impact Investing – is investment in banks, deposit taking institutions, and finance companies that offer financial products with explicit social aim to people, community organisations and social enterprises. Examples could include community finance loans to a social enterprise.
  2. Economic and Social Governance Integration – is where investors factor environmental and social issues into investment decisions, usually through the incorporation of environmental and social risk analysis into financial analysis.
  3. Screening – is the deliberate inclusion or exclusion of investments in companies or sectors based on moral, ethical or religious concerns. Exclusion can be absolute or involve some form of trade-offs.
  4. Shareholder Advocacy – includes both engagement with companies by shareholders on environmental and social issues and the filing of resolutions on significant issues.

A number of Catholic organisations, including Jesuit institutions,  have publicly stated an intention to divest from fossil fuels. The Justice in Mining network recognises that every organisation has unique circumstances that affect their investment decisions. This section of our website aims to provide users with materials that can assist in ensuring investments are ethically aligned with an organisation’s identity and values.

The following links may be of assistance to organisations updating their investment approach along ethical lines:

A document about key things to include in an ethical investment policy:
http://peopleandplanet.org/dl/fossil-free/resources/ei-policy-briefing.pdf

Some faith-based examples of Ethical Investment Policies:

Church of England:
example 1
example 2

Quakers (UK)

Uniting Church of South Australia

Uniting Church (Australia)

The Church in Wales

Other examples

Some food for thought from an ethical investment fund (useful ideas of inclusions/exclusions):

http://www.hunterhall.com.au/ethical_investing_policy.html
http://www.eccr.org.uk/dcs/ceig/Charity_trustees_and_investment_ethics.pdf

Some sites on ethical investing generally (and in particular relating to fossil fuels/environment):

www.gofossilfree.org
http://www.yourfaithyourfinance.org/
http://www.greenfaith.org/programs/divest-and-reinvest
http://brightnow.org.uk/

 

The Justice in Mining network plans to collect and share examples of ethical investment approaches by Jesuit organisations. If you belong to a Jesuit institution that has developed such a policy, and are willing to share it, please get in touch via the Contact page.

 

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